Despite job cuts, the scandal-ridden bank soared 9 per cent to a two-year high

Not bad for a day’s work: more than £3 billion added to the stock market capitalisation of Barclays as shares in the scandal-ridden bank soared 9 per cent to a two-year high.

Declaring there would be “no going back to the old ways”, new boss Antony Jenkins delivered his eagerly awaited strategic review to the City yesterday, along with heavy job cuts and demanding cost-cutting targets. There were results too from the bank, but with its profits wiped out by the mounting bill for mis-selling financial products, Jenkins will have been relieved that his plans to transform the bank’s culture were what interested most people.

For the record, while adjusted profits raced ahead by 26 per cent to £7 billion, at the bottom line Barclays fell into the red by £236 million last year, compared with a profit of £3.9 billion in 2011. That unfortunate red ink has not stopped it paying out a total of £1.85 billion in bonuses, although Jenkins was at pains to stress that this was a reduction on the £2.1 billion payout of the previous year.

The lion’s share of the bonuses – £1.2 billion – are going to the controversial investment banking operation, which produces more than half the bank’s profit. Investment bankers at the group are said to be less than impressed with their new boss, who comes from the more staid retail side of the group rather than the buccaneering “casino” banking business that spawned Bob Diamond. As one City wag said yesterday, they really do think “ethics” is a county to the northeast of the City of London. In the City yesterday, though, Jenkins certainly pushed the right buttons with his much-trailed plans to transform the cowboy culture that has led to a series of costly scandals at the group, from Libor-rigging to mis-selling. Since taking over from the disgraced Diamond in August, the new man has been reviewing 75 of Barclays business units. These have been assessed not only on their financial performance but also on their reputational risk to the bank.

Thus the group, under fire for pushing up food prices with its speculative commodity trading activities, revealed that it would no longer indulge in agricultural trading with hedge funds. It will, however, continue to market agricultural investment products and is not making a total withdrawal from the wider – and lucrative – commodities sector, in which it ranks among the top five banks.

Another reputational weak spot being addressed by Jenkins is the closure of part of the bank’s Structured Capital Markets division, the unit that specialises in “tax planning”(or, as former Tory chancellor Lord Lawson put it, tax avoidance “on an industrial scale”). The unit practices were legal but certainly failed the ethical test, particularly with the growing public anger over the minuscule levels of tax paid by large corporations.

As with its move on commodities, Barclays is not exiting the tax planning sector altogether and it could take as long as a decade for legacy schemes to run their course. The bank says that in future its schemes will provide support for “genuine commercial activity” and comply with “generally accepted custom and practice”. In other words, it will no longer have its financial rocket scientists dream up ever more complex ways of avoiding tax simply because they can.

We’ll see. While the City applauded the Jenkins plan yesterday, sending its stock soaring, the road to reworking the Barclays culture will not be an easy one.

Fiona Walsh writes for the Guardian newspaper in London